Nifty 8716/Sensex 28141/ Bank Nifty 20020
37 Advances / 14 Declines/ 0 Unchanged
Indian benchmarks Salutes to Union budget; ends at three-month high
Indian benchmark indices staged a smashing performance on Wednesday by vehemently rallying over one and half percent in the session and re-conquering their psychological levels. Investors continued to build hefty positions across the board as finance minister Arun Jaitley made no reference to long-term capital gains tax on equities, and also set a comfortable fiscal deficit target of 3.2% for the fiscal year 2017-18. He also propose to infuse Rs 10,000 crore in public sector banks and allocating a record Rs 3.96 lakh crore to infrastructure sector as well as granting infra status to affordable housing.
The focus of the budget continues to remain on improving the macros as government has not succumbed to the populist expectations. He also delivered a big relief to foreign portfolio investors (category I and II) by exempting them from indirect transfer provisions (Vodafone tax). The Finance Minister made it clear that he does see demonetisation’s effect spill over to the next fiscal. According to Jaitley, India's Current Account Deficit declined from about 1% of GDP last year to 0.3% of GDP in first half of 2016-17. Adding optimism among investors, Prime Minister Narendra Modi described the Budget as ‘futuristic’ with an aim on fulfilling the ‘dreams’ of every section, including the poor, the farmers and the under-privileged, while focusing on job creation, transparency, urban rejuvenation and rural development.
He said the Budget is a key link between the work done by his government over the last two-and-a-half and the steps that it will be taking in the future as part of its vision to take the country on the path of development.
Furthermore, market participants got some comfort after Nikkei Markit India Manufacturing Purchasing Managers’ Index (PMI) monthly survey rebounded from demonetization downturn in January amid rising order books, production as well as buying levels and the expansion in the sector by increasing 50.4 in January from 49.6 in December.
Some support also came with report that Growth in eight core sectors expanded at a faster pace of 5.6% in December 2016, against the 4.9% growth recorded in November 2016, supported by double-digit expansion in the steel sector.
Meanwhile, shares of irrigation and fertiliser companies rose after Jaitley, in his Budget presentation said the agriculture sector is expected to grow at 4.1% in 2016-17 thanks to better monsoon, while real estate stocks moved higher on a slew of budgetary stimulus to real estate sector. However, IT stocks continued to fall on visa fears as H1B visa Bill to double minimum wages for H1B visa-holders was tabled in the US Congress.
On the global front, Asian equity markets ended mostly in green on Wednesday, with Japanese shares rising after the yen stopped its ascent following Abe's remarks and the latest survey from Nikkei showing Japan's manufacturing sector picked up steam in January, with a PMI score of 52.7, up from 52.4 in December. Furthermore, Chinese manufacturing as well as services sector data suggested that China's recent recovery remains largely intact at the start of the New Year. China's official manufacturing Purchasing Managers Index (PMI) for January came in at 51.3, higher than a forecast of 51.2, while the services sector PMI edged up to 54.6 from 54.5 in December.
While US Nonfarm payroll employment changed stood at 246k against 153K expected put strong impact on dollar.
FOMC Meet – Keeps the fed fund rate unchanged to 0.75%
Back home, the local benchmark got off to a soft start as the indices showed signs of consolidation in morning trade, ahead of the Union budget. However, the bourses capitalized on the momentum and spurted in afternoon trades on the back of broad based buying in frontline stocks. The northbound journey only concluded with the close of the session helping the key gauges in recovering the ground lost in the last two sessions.
FII Activity (1st Feb 2017)
The FIIs as per Wednesday’s data were net buyers in equity and debt segments both, according to data released by the NSDL.
In equity segment, the gross buying was of Rs 5542.48 crore against gross selling of Rs 5091.41 crore. Thus, FIIs stood as net buyers of Rs 451.07 crore in equities.
In the debt segment, the gross purchase was of Rs 1065.99 crore with gross sales of Rs 882.29 crore. Thus, FIIs stood as net buyers of Rs 183.70 crore in debt.
Key Results
Aegis Logistics Ltd
Astrazeneca Pharma India Ltd
Dr Lal Pathlabs Ltd
Essel Propack Ltd
GE Power India Ltd
Glenmark Pharmaceuticals Ltd
Godfrey Phillips India Ltd
Godrej Properties Ltd
Hindustan Construction Company Ltd
HSIL Ltd
Marico Ltd
Redington India Ltd
Sundram Fasteners Ltd
Take Solutions Ltd
Timken India Ltd
Vijaya Bank
Now what to expect??
Nifty Future Levels
Nifty unable to breach its support level of 8550 and bounced back sharply and made high of 8747.
Now what to expect???
Above 8750….rally remain continues till 8780—8820 mark in days to come else could touch its support level of 8680---8620 again.
Looks weak only close below 8550 mark.
Trade with levels only.
Bank Nifty Future Levels
Yesterday we recommended buying in Bank Nifty above 19900 if flared and made high of 20125 we booked full profit around 20110.
Now what to expect??
Bank nifty looks positive and could touch its resistance level of 20400—20650, further upside rally will see on close above 20650.
Support intact at 19500.00
Trade with levels only.
Today's Top Pick
CEAT
Support at 1150 and Resistance at 1220
Above 1220.... Catch it. We will see sharp upside rally till 1245—1260 and then to 1300+ mark.
Looks weak only below 1150.00
More will update soon!!
